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The city set up the nonprofit San Antonio Economic Development Corp. to sign a five-year deal with InCube, make payments of $2 million per year and monitor progress under the contract.

For its part, InCube agreed to move three startups to San Antonio and launch two others here, raise $15 million from the private sector and create at least 50 jobs paying a minimum of $50,000 — all by the end of the five-year period, ending in July 2015. It also committed to handing over shares in the startups to SAEDC.

So the city et al are investors. But they'd probably only see a profit if Big Pharma or medical device makers devour the startups for their products. That's the exit strategy for most venture capitalists.

That's also a big “if” because most biotech startups fail — something on the order of at least 85 percent. It's not hard to see why. These ventures require gobs of capital for R&D; the technology may not pan out; and the companies often are subject to strict government oversight.

OK, enough background.

Here's the return on taxpayers' investment to date, as detailed in a quarterly update InCube filed with SAEDC last month: the incubator has relocated three startups in San Antonio (Fe3 Medical, Neurolink and Corhythm), all of which need another round of fundraising to advance to pre-clinical and clinical trials, and they've generated a total of seven jobs.

Given that SAEDC has handed over $6 million so far, that works out to $857,142 per job.

Of course, that calculation is the product of old-school thinking, the kind that dictates that in return for, say, a 10-year tax abatement, a company commits to creating 500 new jobs. That's not what the InCube deal is about.

“This is a little bit different,” Sculley says. “We're all pretty positive about the progress of InCube. This is a long-term investment ... There may not be the quantity of jobs, but they certainly are high-skilled and high-paying.”

The idea also was to bring Imran's spark to San Antonio, to spawn companies that would collaborate with researchers and spin out brilliant go-getters who would launch other biotech companies here. Good luck trying to put a dollar value on that.

An aside: Ever wonder what biotech startups already here and struggling to survive thought of the deal?

Collaboration with UTSA, UTHSC and the Texas Research and Technology Foundation is one of the requirements of the contract. Another calls for Imran to be “meaningfully and personally involved” in the project.

Check and check.

Imran travels to San Antonio every other week and has decided to buy a home here, in addition to his house in San Jose. “For me, staying at a hotel every time is getting old,” he says.

He's already raised $9.6 million from private sources and is looking to bring in as much as $25 million in the second round of financing for the three startups. He's “pretty confident” he'll have the commitments lined up in the next several months. But he acknowledges that venture capitalists' derring-do hasn't rebounded with the economy.

“Since 2009, the venture capital industry has not recovered — that poses a challenge,” he says. “But we've made steady progress.” His startups have gotten “a fair amount of attention” from bigger biotech firms and pharmaceutical companies.

All told, Imran estimates that he'll need to raise anywhere from $30 million to $75 million “to take them to a successful outcome.”

In the meantime, he's keeping a lid on expenses. For example, he's using consultants to supplement his tiny workforce.

So what about that 50-job stipulation in the contract? “I'm pretty confident we'll reach that goal,” he says.

After just a few minutes of listening to him, it's nearly impossible not to admire his determination, confidence and optimism — key ingredients for a successful entrepreneur. If I had millions of dollars to spare and knew something about biotech, I'd certainly give Imran a hearing.

But I don't have the spare millions or the technical expertise.

The city doesn't have much spare cash, either. And I'm not at all sure of its skill at picking biotech winners — though Sculley says the city hired local investment banker Alan Chesler to conduct the financial due-diligence on the deal and tapped a group of experts to vet the science.

Sculley also cites the Mir magic: 22 startups and only two collapses.

But many failed startups passed muster. The industry's risky. Companies fall left and right, even smart ones.

My objection to the deal is that a public expenditure that big should amount to more than a gamble, no matter how well thought out, and to more than 50 or so jobs.

Since the InCube agreement, the city has done two similar deals — one with UTHSC ($3.3 million), the other with Innovative Trauma Care ($300,000), a Canadian company that located its U.S. headquarters here. SAEDC also has added to its bench of experts, including Paul Castella of locally based Incyte Ventures.

And the new plan is for SAEDC to eventually make equity investments with profits from previous deals, not city funds.

At least we can be thankful for that.

Greg Jefferson is business editor of the Express-News. He can be reached at (210) 250-3259.